McDonalds

History

1948 McDonald brothers open the first McDonalds and names Speedee as
their company image.

1954 Ray Krock, a multimixer salesman becomes the franchising agent.

1955- Ray Kroc opens the Des Plaines restaurant. The 1st days revenues $366.12

1957 Ray Kroc hands out free hamburgers to Salvation Army guests

1958 Sales grow 151%

1961 Ray Kroc buyout the McDonalds brothers for $2.7 million

1963 Ronald McDonald is introduced

1965 - McDonalds goes public with the companys first offering on the stock
exchange for $22.50 per share.

History
1966 McDonalds stocks split for the first time.
1967 - Big Mac invented
McDonalds in Canada and Puerto Rico open
1971 - Makadonaldo (Japan)
1973 - Egg McMuffin invented
1974 - Ronald McDonald House opened
1979 - Happy Meals introduced
1979-present - Continued growth

Company profile
McDonalds is the words largest fast food
corporation, serving more then 57 million people in
119 countries daily with more then 31,000
restaurants world wide in which 6,899 are owned
by company and 20,499 are operated as franchise
and 3,960 are operated by affiliates.
McDonalds employing more then 1.5 million people
worldwide, only in UK Company owned restaurant
employed 43,492 in 2004 in which hourly paid
employers are 2,292. 2,291 restaurant
management and office staff nearly 500. and
nearly 25,000 people employed in franchises.

Problems
Customer Service
McDonalds is currently ranked last amongst its
top competitors in the FFHR subsector.
#1 Burger King
#2 Wendys
#3 McDonalds

This may not sound bad at first glance, but

when you look at the fact that these three
competitors hold 73% of the FFHR market, it
puts it into perspective.

Problems (cont.)
Health Issues

SWOT Analysis - Strengths

Worldwide Brand Recognition
41% of all fast-food visits are for hamburgers
McDonalds has 44% of US fast-food hamburger
business
Over 70% of the restaurants are independently owned
Ranked number one in Fortune magazines 2008 list of
most admired food service companies. Overseas
market
Over 31,000 restaurants in over 120 countries.

SWOT Analysis Strengths (cont)

Quality measures through supply chain
management
Encourage new ideas from within
Big Mac
Egg McMuffin
Large available amounts of capital for
future restaurants due to holding a limited
number of corporate owned restaurants.
Economies of scale

SWOT Analysis - Weaknesses

Weak product development
Poor relationships with
franchisees
Fluctuations in profit
(which has been improved
in 2008 after the
franchising of many
corporate owned
restaurants)

SWOT Analysis Opportunities

International expansion through continued
franchise opportunities
Only serving 1% of the worlds population
Growth in the beverage industry (by 2011 $71.4 billion in sales with 70.8% being
coffee drinks)
Introduction of local offerings (i.e. Tech
Burger with special condiments and toppings)

SWOT Analysis - Threats

Mature industry
Strength of competition
More health-conscious consumers
Changing demographics
Fluctuation of foreign exchange rates
Increasing commodity and fuel prices

Marketing Techniques

Product Image
Customers associate with the brand
Domestic
Global

Marketing Techniques
(cont.)

Original symbol Speedee

Golden Arches
Building structure and colors
Local advertising

Slogans

Your kind of place (1967)

You deserve a break today (1971)
We do it all for you (1965)
Have you had your break today (1995)
Im lovin it (2003)

Marketing Mix

Five Ps
Marketing and Communications
Responsibility
McSpirit Nights
Commercials
Atmosphere

Global Marketing
National Marketing Campaign
Marketing North America
Hong Kong
France
Australia
Catering to local needs across seas

Management In
McDonalds

Ray Kroc
The quality of a leader is reflected in the
standards they set for themselves
We take the hamburger business more
seriously than anyone else
You're only as good as the people you hire
If there is time to lean there is time to
clean

Hamburger University

McDonalds Center of Training

Excellence

Created by Fred Turner and Ray Kroc in

1961
All levels of managers in the McDonalds
family go through training at this facility.

At McDonalds, our training mission is to be the best

talent developer of people with the most committed
individuals to Quality, Service, Cleanliness and Value
(QSC&V) in the world. Our strong commitment to the
training and development of our people has resulted in
many firsts and honors.

How Does This Affect

McDonalds?
McDonalds has been consistently increasing its
dividends for the past thirty years
From 1998, up until 2007, this dividend growth stock has
delivered an annual average total return of 11% to its
shareholders
Over the past ten years, the annual dividend payments
have increased by an average of almost 25% annually,
which is much higher than the before mentioned growth
in EPS

This 25% growth in dividends translates into

McDonalds dividend payment doubling nearly every
three years

Get the kidsand the

parents will follow.

Past Strategies
Product Development
Hits: Fries, Happy Meal, Big Mac, Egg
McMuffin, Salads, Apple Slices, Yogurt
Parfaits, & Promotions
Misses: McPizza, Fajita, Carrot Sticks, McLean,
and the Arch Deluxe

Past Strategies (cont.)

Market Development
Hit: International growth
Miss: Over-expansion in US
Alternative locations

Forward Integration
Distribution through franchisees with
control over store presentation, menu
items

New Strategies
Product Development: Focus on core
business
Quality and taste issues
Food delivery methods

Family Value Meal

Thursdays $1.59 Happy Meal

New Strategies (cont.)

Redevelop Franchisee Relationships
Market Penetration and Development
Continue International expansion

Cost Reductions
Home office cost reductions
Franchising corporate owned restaurants

Questionary

McDonalds Strategic commitment to training has contributed

to its position as a leading global foodservice retailer

Human resource management plays an important role in the success

of a company. Most of the companies are very keen to pay attention
towards their employees. Mainly HRM (Human Resource
Management) is all about managing people at work. The most
important part of human resource management is Training and
Development. It plays a key role in every organisation though few
people disagree about the importance of training and development
in the success of organisation. Appointing the right person at right
time at right place needs more care and attention on the part of
personal manager. A clear set of goals and well defined path should
be needed for good training. Training changes attitudes, knowledge
and skills of employees and also the way they work. It is reflection
of the fact that companies are keen about training and
development to gain competitive advantages.

Examine Ray Krocs training philosophy & How has

McDonalds gained from training philosophy
If I had a brick for every time Ive repeated the phrase
Quality, Service, Cleanliness and Value, I think Id probably
be able to bridge the Atlantic Ocean with them. Ray Kroc
Rewarding InnovationRay Kroc believed in the
entrepreneurial spirit, and rewarded his franchisees for
individual creativity. Many of McDonalds most famous menu
itemslike the Big Mac, Filet-O-Fish and the Egg McMuffin
were created by franchisees. At the same time, the
McDonalds operating system insisted franchisees follow the
core McDonalds principles of quality, service, cleanliness and
value.

orientation training at
McDonalds

McDonalds, weve got a great reputation for the quality of our training
and development courses. In fact, a lot of our most successful
Managers started their careers as Crew members. You can do it too,
and the best part is you get to earn while you learn!
So what kind of training are we talking about
Communication: interacting with colleagues, the management team and
our customers.
Practical skills: delivering exceptional customer service, handling
money, using equipment and product quality control to name just a few.
Time management skills: organising yourself so youre always prepared
for the rush and of course the importance of always being punctual
Team skills: learning to work along other Crew Members and
contributing to the team.

Evaluate training effectiveness at McDonalds

There are three key objectives of the report: first, to
identify models, frameworks, methodologies, and approaches
as well as their uses and feasibility in evaluating training
programs; second, to summarize how the quality and
effectiveness of these evaluations are assessed in theory
and in reality, and mainly, what cutting-edge methods and
approaches other organisations use to maintain the quality
and effectiveness of their evaluations; and, third, to outline
some common practices of corporate evaluation units.

Recommendations
Improvements in:
Customer Service
Focus on team, not individuals
Reward the behavior that you want

Training/Compensation
Training in customer service, speed and accuracy
Increase pay to attract more qualified applicants

Technology
Improvement of order verification system

Continued Growth of International Market

Conclusion
You can change without improving, but you cannot improve
without changing!
In todays fast growing and highly competitive environment
everyone wants to stay ahead and always remain connected to
the whole world. The last two decades have seen many
inventions that are really path breaking and changed our
lifestyles in more than one or another way. This is possible
only because of the changes and innovation in the organization.
Change management has become one of the major components
which helps in managing the work, strategy, organization,
people and culture of the organization. Change is important so
as to keep an organization more competitive to face the
changing demographics and technological trends and
increasing globalization

Thank you